ABC News' Teddy Davis, Arnab Datta, and Rigel Anderson Report: Sen. Barack Obama’s, D-Ill., top economic advisors announced on Thursday that he is seeking to raise the capital gains tax rate from 15 percent to 20 percent for those Americans making more than $250,000 per year.
“The top capital-gains rate for families making more than $250,000 would return to 20% -- the lowest rate that existed in the 1990s and the rate President Bush proposed in his 2001 tax cut. A 20% rate is almost a third lower than the rate President Reagan set in 1986,” wrote Obama advisors Jason Furman and Austan Goolsbee in Thursday’s Wall Street Journal.
Thursday’s Wall Street Journal op-ed is the first time that Obama’s campaign has pinpointed the scope of his capital gains tax hike on families making more than $250,000 per year, according to Obama spokesman Bill Burton. The details on the capital gain tax hike are part of a broader economic platform that prioritizes tax relief for middle-class families over deficit reduction.
When asked about the capital gains rate back in March, Obama told CNBC’s Maria Bartiromo that he “certainly would not go above . . . 28 percent,” adding, “and my guess would be it would be significantly lower than that.”
He went on to say: “I think that we can have a capital gains rate that is higher than 15 percent [the current level]. If it – and if it, you know – when I talk to people like Warren Buffet or others and I ask them, you know, what’s – how much of a difference is it going to be if it’s 20 or 25 percent, they say, look, if it’s within that range, then it’s not going to distort, I think, economic-decision making.”
In the past, Fox News analyst Dick Morris has used Obama’s seeming openness to raising the capital gains rate as high as “28 percent” to argue that the presumptive Democratic nominee favors a “doubling” of the tax on capital gains.
On television, in op-eds, and in his new book, “Fleeced,” Morris has converted the Obama line into the false charge that the presumptive Democratic nominee “pledges to double the capital gains tax.”
“This misguided policy will drive capital off shore and turn a flow into a torrent,” wrote Morris. “The financial problems of American banks will be amplified. McCain should pounce on this issue and correlate the current crisis with Obama’s position on capital gains. It would be a big winner.”By getting specific about how high he would like to see the capital gains rate go for families making more than $250,000 per year, Obama is helping to inoculate himself against the charge that he is open to going almost as high as 28 percent.